Feeling confused about the Affordable Care Act? There’s a good reason for that. The federal agencies charged with implementing the 2010 health care reform law — the U.S. Labor Department, Department of Health and Human Services and the Treasury Department — are still working out the rules. Here’s a quick look at the delays and impending deadlines affecting employers.
Employers with 50 or more full-time workers will have to pay a tax penalty of $2,000 to $3,000 per employee if they do not offer health insurance plans to those workers or if those plans do not meet ACA standards. Status: delayed until 2015.
For more: Internal Revenue Service, tinyurl.com/ACAprovisions
Out-of-Pocket Limits for Consumers
The cap on out-of-pocket costs, set by law at $6,350 for an individual and $12,700 for a family, has been postponed for some insurance plans. The delay allows employers that offer separate plans, such as for doctor and hospital care and another for pharmacy benefits, to keep out-of-pocket limits separate for each. Drug care plans that do not currently have an out-of-pocket limit will not be required to implement one yet. Status: delayed until 2015
For more: U.S. Labor Department, tinyurl.com/out-of-pocket
Notification of Marketplace Coverage
Every employer that is subject to the Fair Labor Standards Act is required to notify all employees of the health care options available on health insurance marketplaces or exchanges by Oct. 1. Those exchanges will begin enrolling consumers starting that date. In practice, this requirement affects the majority of employers; FLSA applies to employers with at least two employees and $500,000 in annual revenue or sales as well as hospitals, nonprofits, schools and government agencies. New hires starting in October will need to be notified within 14 days. Notices must tell employees whether their employer-sponsored plan meets the minimum value standard and is considered affordable under the definitions of the law and that they might qualify for a premium tax credit if it doesn’t. Deadline: Oct. 1, 2013.
For more: U.S. Labor Department, tinyurl.com/FLSAhealthcare
Summary of Benefits Coverage
Employers are required to provide a summary of benefits and coverage in fall open-enrollment materials that informs employees if the coverage offered meets minimum essential coverage and value standards set by the law. Employers that do not have an open-enrollment period must provide the statement 30 days before the beginning of the plan period. Deadline: Fall open-enrollment period or 30 days before beginning of plan year.
For more: Sibson Consulting Capital Checkup, tinyurl.com/openenrollmentsummary
Even though the employer mandate has been delayed, employers will need to start collecting information in order to manage the potential penalty they will have to pay in 2015. Employers aiming to minimize their tax exposure will have to choose a 12-month period to measure employee job status. Employees determined to be working full time will need to be offered coverage in 2015 or employers will be liable for the penalty. In order to meet reporting requirements, measurement may need to begin late this year. Deadline: fall 2013.
For more: Internal Revenue Service, tinyurl.com/employeestatus